momagri, movement for a world agricultural organization, is a think tank chaired by Christian Pèes.It brings together, managers from the agricultural world and important people from external perspectives, such as health, development, strategy and defense. Its objective is to promote regulationof agricultural markets by creating new evaluation tools, such as economic models and indicators,and by drawing up proposals for an agricultural and international food policy.

Renting the land : a new development lever for poor countries ?

24 November 2008

The Financial Times recently revealed that last July, through an affiliate of the Daewoo food conglomerate, South Corea had come to an agreement with the Madagascar government, rare among international contracting records : a 99 year rental of 1,3 million hectares on the Grande Ile (equivalent to half the surface of Belgium). The South-corean company expects to produce 500 000 tons of palm oil per year there, as well as 4 million tons of corn. A means for South Corea, the fourth largest corn importer in the world, to secure its supplies in a context of particularly destabilizing price fluctuations.

But Madagascar’s case isn’t unique ; Angola which today imports close to half of its food needs, is also thinking of calling on private foreign companies to boost production on the 90% of non-cultivated farmable land ; Soudan, for its part, is courting investors for its own 900 000 hectares while Ethiopia’s Prime Minister, Meles Zenawi is reaching out to countries which production capacities are insufficient to secure their food security (such as the Gulf area countries).

Beyond the financial investment, many poor countries consider this practise as a means to promote their country’s development. Thus, in the case of the recent agreement between the Madagascar government and Daewoo’s affiliate, where the contract doesn’t involve cash payments to the Madagascar government, the latter very much expects to benefit from employment opportunities and infrastructures which the Corean company committed to create.

However, if such contracts can, at first glance, prove to be beneficial for poor countries, these can, in the longer term, impact their security and food sovereignty, in as far as they are still strongly dependent on international food aid and foreign imports.